Better off unemployed or working less than 15 hours a week?

SarahLou

Just a general enquiry really as I've heard this on the grapevine for many a year but never really known if it was true.

My questions are this:

As a married couple, hubby working full time on a mediocre wage (just over £17K a year), would I be better off unemployed and claiming the full whack of the child tax credits, working tax credits, etc, etc?

(I'm on just short of £6500 a year).

Also, is there any truth in the rumour that you get more in the way of child tax credits if you work 15 hours or less a week?

We only get child benefit and child tax credits (one child - just about to turn 3). Don't get anything else. And I'm now very concerned as I've supposedly been overpaid on the child tax credit front so have money to pay back (or, more precisely, won't be receiving any payments from them for a considerable period of time).

I used to get £170 ish a month CTC before I started work. Now I work 17.5 hours a week and will be on nowt whatsoever from them for a long time (I estimate it'll be at least 12-18 months while I pay off this so-called "debt" which I feel was their fault anyway as I've always kept them in the loop - never been dishonest in my life (but thats another story - and another thread specifically about my problems with being overpaid CTC!))

Are either of those rumours true?

AnxiousMum

I don't know the specific answer to your questions, but if you go onto the HMRC site and go to the 'do I qualify' section, put in your numbers, it will tell youe what you would get.

However, I do know there is LOTS OF TRUTH to the RUMOUR that if you work part time, and then when your children reach school age and you can work more hours, you earn more money! Also, you qualify for pay increases each, more experience, possible training to further your career, and seniority within your workplace! Amazing eh?

DX2

Better off getting a better job.

Hannah_10

No you would not be better off unemployed, as CTC is paid to bring your income up to a far higher level than unemployment every time. Do not believe the things you read in the papers about how everyone without a job is on a fortune, it's just not true. It's a way of selling newspapers and it's very damaging to peoples self esteem and to the economy too actually because it demotivates people from standing on thier own 2 feet when you are able to.

The basic truth is that the more you do for yourself, the better off you will be and the tax credit system is set up to reflect that. Why not play around with an online benefits calculator to see for yourself. There is one at https://www.entitledto.co.uk as well as at the HMRC site.

karenx

Even with working less than 16hours per week that income is still taken into account for tax credits. And plus with working less you wont qualify for any help with childcare costs if you need them

LizzieS_2

Frank Field did a report a few years ago on child poverty - the income of a single parent was the same (or more in real terms) than a couple both working full-time with associated childcare costs. The only real way for a couple to benefit is to work in such a way that no or little childcare is required (free childcare from relatives or work different hours).

Earning £6500 virtually takes you out of taxation - you keep more of your income. It all comes down to how much childcare you have to pay yourselves (after taking away the extra tax credits you get) against your net income. Even if you do not gain or not gain much - what are your chances of finding another job in a couple of years if the current employment climate does not improve?

SarahLou

All very fair points made - thanks everyone.

Good to know the scare-stories in the paper aren't true!

Googlewhacker

SarahLou wrote: »

All very fair points made - thanks everyone.

Good to know the scare-stories in the paper aren't true!

As much as you shouldn't take newspapers as gospel you shouldn't take other Forum users views as gospel.

Go do some research and see for youself how you would fair.

drrat

As said above the benefits system is geared to make working on low pay better than not working at all.

However, whether its worth working as opposed to being unemployed is a question only you can answer.

I say this because I work fulltime, by wife currently stays at home, due to several young children, but she did work evenings for a while. And we found that although we were financially better off the financial benefit was not worth the stress of her going to work the second I came home caused.

Some people would view their effective salary as being the difference between their non working income and their working income and if the difference was not high enough would choose not to work. This is particularly the case for singlre people with no children. I think you would have to be particularly work shy to choose not to work in this manner if you had kids as working benefits are far more generous.